Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

Australian governments have failed to create wealth from the Commonwealth's ownership of vast reserves of oil and gas. I had thought it was a case of mismanagement and incompetence. Now it's clear: foreign owned oil and gas companies have too much political influence in Australia. I can think of no other explanation for the major parties arguing against the proposal in this bill.

Everyone seems to agree our natural resources should be developed for the benefit of the Australian community, but, when I propose putting that idea into the law, it is opposed by the government and the opposition. It's no wonder the primary vote of both major parties has fallen over the years and Liberal Party membership is falling faster than lemmings running off a cliff. In the Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill 2020, I propose to make the benefit of the Australian community a guiding principle in the interpretation of the Offshore Petroleum and Greenhouse Gas Storage Act 2006, or OPGGS Act. The Australian OPGGS Act is 1,150 pages of rules, rules which address in detail the awarding and management of petroleum licences, titles and safety and the jurisdiction of the regulator. The equivalent legislation in Norway is 39 pages long and is objectives based.

The Morrison government and the opposition say they oppose my 17-word amendment to the OPGGS Act because of unintended consequences. My view is that the proposed objects clause would fix many of the existing unintended consequences created by the narrow focus of the OPGGS Act, such as causing taxpayers to take on the liabilities of the Northern Oil and Gas company in February 2020, which include $4 million a week to maintain the floating platform known as the Northern Endeavour in non-production mode and the decommissioning costs of the Laminaria and Corallina oilfields in the Timor Sea, which are estimated to be up to $1 billion. It would fix unintended consequences like enabling foreign owned companies to hoard petroleum licences when Australian companies would be willing to put long-held licences into production and bring that gas onshore to Australia.

Unintended consequences have not proven to be a problem for Norway, who have made the benefit of the Norwegian society as a whole a guiding principle in their equivalent of the OPGGS Act, the petroleum activities act. Section 1.2 of Norway's petroleum activities act states that petroleum resources are to be managed for the benefit of the Norwegian society as a whole. Managing petroleum resources for the benefit of Norwegian society as a whole has created a sovereign wealth fund of around $1.4 trillion and funded the best aged-care system in the world. Australia will never have a sovereign wealth fund like Norway's, because the big political parties put their interests ahead of the interests of the Australian people.

My bill is not a tax bill and does not seek to change any tax law. In April 2017 Michael Callaghan handed his report to government. In 2019 the government responded to the Callaghan report by removing taxes from onshore gas. Here we are, four years later, and only now the government says it will consult with the industry on whether it would be willing to pay for our gas. Good luck with that! My bill is about increasing the supply of gas to Australia, with a view to lowering the price of gas in Australia and creating new jobs. How do government ministers sleep at night knowing that Australia is the only large gas exporter in the world where the domestic price of gas is higher than the exported price? The price differential is a massive problem for us. The multinationals are taking out and exporting $50 billion worth of Aussie gas. And, thanks to the deal our government has done, we get only around $200 million in taxes. The tiny nation of Qatar has a different approach. It receives around $26 billion in royalties on the gas it exports.

What is wrong with our government? We should be telling these multinationals, in regard to the retention leases in place, that they need to use it or lose it, not just build up never-ending tax credits at our expense. Our government is propping up the multinationals while denying Australian companies who want to develop the opportunity to extract gas. The government won't encourage the building of a pipeline from the north-west to the eastern states as promoted by Twiggy Forrest—a nation-building project worth tens of thousands of jobs that will benefit Australians for decades. We're paying more domestically for our gas than they are in the countries it's exported to.

Gas sets the price of electricity one day in four. As our aged coal-fired power stations are retired and replaced by gas-fired power stations, the price of gas will increasingly set the price of electricity. If we pay more for gas than our competitors do, we pay more for electricity than they do. If we want to sell what we make, and buy what we need, we must be able to buy our natural gas at the same price as our competitors overseas do, and we must be able to deliver globally competitively priced electricity to families and industry. The government fell into an elephant trap when it timetabled the closure of coal-fired power stations before it had a plan to replace the reliable electricity they provide to households and business. I say 'elephant trap' because the inability to supply electricity after the retirement of these coal-fired power stations was so obvious and so big that it should have been avoided.

The belt-and-braces solution successfully adopted by Germany has not been followed by this government. Instead, the Australian government has adopted the high-risk approach. It has bet the farm—your farm, my farm, everyone's farm—on finding solutions to grid stability problems caused by wind and solar power before we lose the reliable electricity provided by coal. In the next 15 years, nine coal-fired power stations in Australia are timetabled to be shut and with them the loss of 60 per cent of the reliable energy they produce. The Liddell Power Station in the Hunter Valley in New South Wales is the first of nine large power stations to be retired in the next 15 years. Its closure in April 2022 was announced in 2015. But, despite seven years notice, there is no replacement in sight for the 1,860 megawatts of reliable electricity Liddell now produces.

This third-term government has been so focused on the next headline or poll of public opinion that it has been caught without a plan to stop widespread blackouts, load shedding and energy demand management after Liddell's planned closure. The government has brought 12 months of reliable electricity supply to the nation by making Liddell's owner keep the coal-fired power station open until April 2023. Further, the government told the private sector they must make final investment decisions to replace 1,000 megawatts of Liddell's power by April 2021, or the government will step in and build a gas-fired power station at Kurri Kurri near Newcastle. The private sector have no intention of pulling the government out of the elephant trap, and their laughter at the government's fanciful plan echoes around the world. Since then, the owners of the Yallourn Power Station in Victoria have announced it will close four years earlier, and the elephant trap just gets deeper. The government has little choice but to build a gas-fired power station and increase the supply of gas.

The government's Clean Energy Finance Corporation Amendment (Grid Reliability Fund) Bill 2020 is intended to funnel a billion dollars into fixing grid reliability problems and allow the funding of the Kurri Kurri gas-fired power station. One Nation's view is the government should fund the building of new clean-coal-fired power stations rather than waste any more money subsidising weather-dependent electricity supply. Coal-fired power stations in the eastern states, including South Australia, will deliver the globally competitive electricity prices we need to manufacture steel, glass and aluminium. The government says it will not pick winners for the supply of electricity. But at every opportunity it distorts the market with subsidies and policy, and to keep the masses happy it talks about unproven technology like hydrogen. Where does the government think it's going to get the hydrogen? Huge amounts of heat created by gas-fired electricity will cleave off the hydrogen from either natural gas or water. But in any case hydrogen technology will not come in time to rescue the government.

The 2021-22 budget handed down last October announced the government wants to unlock the state and territory owned onshore gas reserves by spending $28.3 million in five strategic basins. Onshore gas providers have subsequently told the Australian Energy Market Operator the government's plans to increase onshore gas supply are unrealistic, which leaves the government with little alternative than to reform the gas laws relevant to the federally owned offshore gas. That brings me full circle back to the proposal contained in my bill. My proposed amendment to the OPGGS Act will have the effect of increasing the supply of gas to Australia, and eventually the price will be lowered. The Australia Institute supports the proposed addition to the objects clause, saying that offshore oil and gas industries contribute little to the Australian economy in terms of tax revenue and employment. Many projects represent a net cost to the Australian community as subsidies, clean-up costs, environmental impacts and depletion outweigh the relatively small tax and employment benefits. Prosper Australia also supports the proposed amendment. They say the current objectives of the OPGGS Act breach Australians' human rights to a fair return on the exploitation of their natural resources and call successive government failures in their brief as landlord-in-chief for all Australians. Perhaps the most surprising response to the proposed amendment comes from the Department of Industry, Science, Energy and Resources, which argues against the proposal on the grounds it would create unacceptable uncertainty for titleholders and decision-makers. What about the owners? That is the problem. The OPGGS Act just benefits oil and gas companies. This must change.

My proposal is modest, but it's a positive first step. The Australian people need to make these issues election issues if they want to fund aged-care reforms and the NDIS. If Australians don't prioritise these issues, they can expect to spend their final days without the essential things we all need. As I've said continually in this House, we are just giving away our resources. We do not charge the multinationals and we don't hold them to account enough. When we got Prelude, which is a floating platform, the former resources minister, Senator Canavan, allowed them to hook it to the continental shelf. They don't pay anything like the others do of the 15 per cent domestic gas supply that comes across the borders of Western Australia. I've said in my speech that approximately $48 billion to $50 billion a year in gas is exported from Australia, and we are lucky to get about $200 million or $300 million in returns from that. Yet Qatar, who don't export as much gas as we do—we are the largest exporter in the world—make $26.6 billion from their gas. Papua New Guinea have their gas up there. We actually did the deal for them. They make more out of their gas—about $1 billion a year—than we do.

We in this country are the fools. Surely we can take note of what happened in Norway? They have exported their gas and they have got paid for it. They have a $1.4 trillion fund. What is wrong with the people in this place? Why are they not supporting the Australian people? These are our resources. We will never get them back again. We are not making the money out of it that we should. We are talking about aged care at the moment and how we are going to fund it. All they are worrying about is taxing the Australian people again. They are not looking at taxing the big multinationals. They have retention leases in Australia for 35 years. They keep signing off to give them another retention lease. They don't put on them, 'Use it or lose it.' They don't say, 'You have to develop this.' I know of Australian companies that actually want to be able to work those leases, but we won't give them the opportunity.

They are destroying our own companies. They are not making multinationals pay their fair amount of tax in this country and yet they are forcing the Australian people to pay higher prices for our gas than what we export it at. These are manufacturing industries. If you want to head down the path on climate change of going to wind and solar, it won't drive our manufacturing industries and provide jobs. It is about time they wake up to themselves in this place and look after the Australian people and our resources, because they belong to the people, and charge accordingly.

David Van (Victoria, Liberal Party) Share this | Link to this | Hansard source

I also rise to speak on the Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill, a bill that is noble in intent but, I'm afraid, flawed in its execution. Before I go into the details of the bill, I recognise just how important this industry is to Australia's export performance. Australia has abundant supplies of natural gas both offshore and onshore, enough for more than 50 years based on current production. It is Australia's third-largest energy resource, after coal and uranium, and it is a crucial part of Australia's energy mix, providing a quarter of the nation's needs.

Australia is one of the world's two largest liquefied natural gas exporters. Australia exported 78.3 million tonnes of LNG in 2020, valued at approximately $36.2 billion. LNG is Australia's second-largest energy export commodity, behind iron ore. Natural gas from Australia is exported to many countries in the region, mainly Japan, the largest importer of Australian gas, China and South Korea but also Taiwan, Malaysia, India and other places via spot markets.

The Australian oil and gas industry directly supports over 32,000 jobs. The National Energy Resources Australia, NERA, estimates that each direct job in the oil and gas industry supports an additional 10 jobs across the supply chain in the wider economy. Ernst & Young have estimated that over $310 billion would have been spent between 2010 and 2020, highlighting Australia's strong place in the upstream industry. This includes about $170 billion spent directly since 2007 on five offshore LNG projects, which include Pluto, Gorgon, Wheatstone, Ichthys and Prelude. Growth of the market since then has seen Australia become the largest LNG exporter in the world, overtaking Qatar as additional LNG plant capacity has come onstream over the last few years. This has meant more export earnings, or royalties, and greater export income, something that benefits all Australians, as it provides not only taxation but also royalty income to help fund infrastructure, education and social services.

One Nation is proposing to add the following clause to the objective of the existing Offshore Petroleum and Greenhouse Gas Storage Act:

… to ensure that the exploitation of these natural resources is for the benefit of the Australian community—

the remaining objects of the act are:

(a) to provide an effective regulatory framework for:

(i) petroleum exploration and recovery; and

(ii) the injection and storage of greenhouse gas substances;

in offshore areas …

While this change might seem innocuous, in effect it injects a major uncertainty into the act. It would make potential legal challenges to decisions made under the act more likely. The OPGGS Act provides for the safe and responsible operation of offshore oil and gas activities. It ensures that risks to safety and the environment are reduced to as low as reasonably practicable. It also ensures that industry meets the requirements of good oilfield practice and ensures that the recovery of oil and gas is at its optimal level.

The proposed One Nation amendment injects ambiguity and uncertainty into the objective, particularly around the use of the term 'for the benefit of the Australian community'. The issue that I have is this term is not defined and would therefore likely be open to interpretation by the courts. The courts rely on stated objectives of an act to help them interpret those acts, and it will be up to them to decide what such a benefit means. As we've seen, the courts have become far more active in accepting legal challenges to resource projects based on a range of environmental arguments, so it would seem highly likely that activist groups could use the One Nation objective to argue that an activity such as drilling an offshore well to recover oil is contributing to, let's say, climate change or impacting the environment. Therefore, they would argue, it is not for the benefit of the Australian community. If a court accepted that argument, it rapidly flows on to all the activities regulated under this act. Even if the courts did not accept this argument, the process of legal challenges can take years, and we've seen that in so many projects over the years, particularly in Senator Hanson's home state of Queensland. So, even if the challenge is ultimately unsuccessful, the process can be lengthy enough to effectively derail projects.

The stated aim of amending the objective appears to be around collecting more tax from the industry, which One Nation and Senator Patrick both believe is inadequate. However, as the Economics Legislation Committee noted in its report on this bill:

Taxation treatment is not a responsibility of the OPGGS Act but rather fits within the legislation under the purview of the Treasurer such as the Petroleum Resource Rent Tax (PRRT) and company taxation arrangements. The PRRT is a profits-based tax and specifically recognises the large investments required to explore for, and produce, oil and gas resources.

As a result, One Nation is seeking to turn an industry regulatory act into a taxation act. It is ill-fitting both the objectives of the current act and the type of regime it is enacted under.

As we know, offshore petroleum activities—and that includes oil and gas exploration and development, along with greenhouse gas storage—in Commonwealth waters beyond state and territory coastal waters are governed by the Offshore Petroleum and Greenhouse Gas Storage Act 2006. We also know that Commonwealth waters are three nautical miles from the territorial sea baseline to the edge of the outer limits of the continental shelf. The object of the legislation is to provide an effective regulatory framework for petroleum exploration and recovery and the injection and storage of greenhouse gases in those offshore areas. The legislation provides the framework of rights, entitlements and responsibilities of governments and industry and is objective based. Importantly, the framework also sets out the requirements for occupational health and safety, structural well integrity, environmental management and resource management.

The OPGGS Act also establishes a regulator and a titles administrator. The National Offshore Petroleum Safety and Environmental Management Authority, commonly known as NOPSEMA, is an independent statutory body. NOPSEMA and the National Offshore Petroleum Titles Administrator, NOPTA, are both cost recovered from the offshore oil and gas industry. An audit of NOPSEMA was conducted by the Chief Scientist, Dr Alan Finkel, and relevant experts in 2019. That audit provides an additional level of assurance to the community that the relevant scientific and environmental considerations are part of NOPSEMA's assessment process and decision-making. Dr Finkel's audit found that NOPSEMA is a highly skilled, professional and competent regulator, that it has appropriate processes and practices to meet regulatory requirements under the Offshore Petroleum Greenhouse Gas Storage (Safety) Regulations 2009 and that NOPSEMA has appropriate processes and practices to ensure that environment plans are assessed against relevant, sufficient and complete scientific and technical information.

The OPGGS Act has established a regime that enables a title holder to progress from exploration through to production and decommissioning. Offshore petroleum titles provide rights to companies to apply for permission to undertake petroleum related activities within their title area, and those proposed activities are subject to approvals for environmental and safety matters and technical title assessments, based on resource management. Title decisions under the OPGGS Act are made by the joint authority comprising the responsible state or territory minister and the responsible Commonwealth minister. This joint decision-making arrangement with states and territories recognises that offshore oil and gas projects play an important role in supplying natural gas to domestic markets and generating economic activity in regional areas.

According to publicly available title data, there are currently around 366 active offshore petroleum titles and around 80 companies active in Commonwealth waters. Of these titles, there are currently 82 active petroleum retention leases in Commonwealth waters. The OPGGS Act requires regular five-yearly reviews of the commercial viability of oil and gas resources under the retention release, with discretion for governments to initiate a commerciality review within the five-year period if required.

This industry is incredibly important to Australia. It directly supports over 32,000 jobs, and National Energy Resources Australia estimates that each job adds 10 additional ones. It bears repeating: 10 additional jobs. Further, Ernst & Young has estimated that over $310 billion will have been spent between 2010 and 2020, highlighting Australia's strong place in the upstream industry. So I think it's safe to say that this industry is not one that we want to put at risk of activists or activist courts.

Tim Ayres (NSW, Australian Labor Party) Share this | Link to this | Hansard source

It's a very good time, this Monday morning, to have a Western Australian in the chair, Madam Deputy President, although momentarily—a proud Labor Western Australian. There is a concentration of Western Australians, I notice, in the chamber today. In fact, there are two more Liberal senators from Western Australia here than there will be Liberal members of the Western Australian Legislative Assembly over the course of the next three or four years. I don't say that with any hubris, glee or any of those things—no smugness from me about this issue, none at all! But they could conduct future caucus meetings over there in a Goggomobil, I'm told. I look forward to seeing that, and I look forward to Premier Mark McGowan continuing to represent the interests of Western Australians strongly, as he did last year when the Prime Minister, Mr Morrison, and Clive Palmer teamed up to try and stop—

Claire Chandler (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Order! Please resume your seat, Senator Ayres. Senator Hanson?

Pauline Hanson (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

Point of order: this is not relevant to the bill that's before the chamber. The senator needs to be drawn back to the bill.

Claire Chandler (Tasmania, Liberal Party) Share this | Link to this | Hansard source

Thank you, Senator Hanson. I'm wary that we have wide-ranging debate in this place, but I remind Senator Ayres to be relevant to the bill in question.

Tim Ayres (NSW, Australian Labor Party) Share this | Link to this | Hansard source

I will get back to it. The Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill 2020, as is constructed, has a series of objectives. I listened to Senator Hanson carefully as she made her remarks in support of the bill. Senator Hanson is correct to point to the many, many years of energy policy failure in this country. She is correct to point out, in particular, the failures of this government on energy policy, in particular in relation to gas and oil. There aren't too many ordinary Australians who can understand why it is that Australia exports gas to industrial and energy consumers around the globe at one price but is currently constructing import facilities on the east coast to import gas at a higher price. Allegedly, we're to have a gas led recovery, but it's hard to see that there's any real policy or any real substance behind the government's claims. From a legal perspective, this bill doesn't meet those requirements.

The existing Offshore Petroleum and Greenhouse Gas Storage Act has two clear objectives: to provide an effective regulatory framework for petroleum exploration and recovery; and the injection and storage of greenhouse gas substances in offshore areas. Adding a legal requirement that resource exploitation is for the benefit of the Australian community doesn't, in our view, achieve the objectives Senator Hanson has set for the parliament or for the bill she has put forward. She is right to point, in particular, to those European economies and the way that they have handled these questions. The history of Norway in this space, over the course of the last 40 or 50 years, is a history of careful public management of public reserves not just in the interests of the citizens of Norway but also for all of the Scandinavian countries—a careful management of energy policy and industry policy that means that those countries are net exporters of manufactured goods.

Senator Hanson is right to point to the German example, where German manufacturing continues to be a mainstay of the German economy. In fact, Germany has a trade surplus in manufactured goods with China. It is the product of generations of careful industry policy, of active government, of making sure that the energy policy requirements of German industry are met. It's a complete counterpoint to the abject failure, over successive governments of the Liberal and National parties, to actually do the serious, long-term, beyond-the-political-cycle hard work that is required to deliver manufacturing industry, to deliver trade surpluses that deliver good jobs and to lower energy prices for households and for industry.

Offshore petroleum developments are already subject to a range of vastly more specific regulations to test if they're for the benefit of the Australian community. The existing act already gives responsible state and Commonwealth ministers the capacity to suspend leases if that is in the national interest. It's a political test, subject to the judgement of an elected official—as it should be. We don't include 'for the benefit of the Australian community' clauses in other regulatory frameworks; it's implied. It is clear that public officials and elected officials should act in the community interest. When the parliament legislates, it legislates in the interests of the Australian community.

Of course, that's open to political debate. It's the very source of political debate. Adding a redundant 'for the benefit of the Australian community' clause doesn't mean that oil and gas developments are environmentally sustainable; it doesn't mandate that Australian oil and gas investments should employ Australian workers and offer them decent wages and conditions; it doesn't deliver the objective that they should create real tax revenues that can be spent on protecting vulnerable Australians and making the country stronger; and it doesn't mean that cheap natural gas produced here could be used in Australian industry.

Those are all objectives that I'm sure Senator Hanson shares with most of the other senators in this place. If senators were interested in pursuing those objectives they would have voted for them in previous legislation and would have forced the government, over the course of this last miserable eight years, to do its job in the interests of Australian citizens and Australian industry. If we want to deliver a result in this parliament which meant that more tax revenue was extracted from these projects then we won't deliver that objective by amending this piece of legislation.

If we were concerned in this parliament about the wages and conditions of workers in offshore gas, well, where was this parliament when workers at the Esso offshore rig in Longford had their pay cut by 40 per cent? There was a picket line for 742 days, trying to defend the rights and interests of those workers. There were 742 opportunities for senators in this place to show their support while, this week, we'll be considering legislation which would strengthen the hand of companies which want to cut the wages and conditions of ordinary workers. There will be an opportunity this week to be on the side of ordinary workers in collective bargaining and trying to defend their jobs and wages against companies which will use every trick in the book—every opportunity in the legislation—to reduce costs and to act against the interests of ordinary people.

The public interest test is capable of managing concerns about offshore gas developments. It does require some leadership. There is even a recent example: the application by Advent Energy to open up petroleum exploration from Manly to Newcastle as close as five kilometres offshore. The licence, called PEP 11, would have opened up some of our most densely populated and most tourism-dependent coastline to gas exploration. It was an absurd and dangerous proposition. It didn't stack up from an economic perspective, an environmental perspective or, indeed, an energy perspective. Opposition to the proposal included the local tourism industry; the local fishing industry; local surfing groups; Indigenous communities; local Labor MPs; local Independent members of parliament, such as Ms Steggall; and local Liberal MPs, such as Ms Wicks and Mr Falinski. Even the New South Wales Nationals—not known for their environmental credentials—opposed the project.

But the minister who had the power to sign off on the proposal wasn't swayed. The member for Wide Bay said that he was concerned about some of the exaggerated claims being made by groups who are opposed to the permit. He went on to say:

I mean, this exploration area is over 4000 square kilometres. A well, if one is actually successful in terms of an exploration permit, is only the size of a dining table. I mean, I think we just need to have some perspective of what's been proposed. And right now, this is an extension of the exploration permit.

He said, 'Any rig is unlikely to be visible from the coast.' So the minister at this point was completely contemptuous of legitimate community and industry concerns, and it took the Prime Minister being dragged by the only thing that this Prime Minister understands—that is, negative public opinion—to that conclusion by public opinion to stop it. And where did he do it? He did it at the place this Prime Minister does all things: at a press conference.

There is in this process in this place the fact that changing the act won't fix the problems that Senator Hanson has pointed to and that many other senators around the place have pointed to. Changing the Prime Minister might have that effect. Changing the minister might have that effect. It requires public officials, members of parliament, senators and ministers who are prepared to act in the public interest. We are the second-largest exporter of natural gas in the world, yet our domestic gas prices are consistently higher than international ones. While the port of Gladstone is exporting over 20 million megatonnes of natural gas annually, other ports along the east coast are building import terminals. The coalition has promised a gas-led recovery, but their record on fuel security is abysmal. It is just bunkum. Instead of focus group tested targets designed to wedge their opponents and trying to dig themselves out of catastrophic policy failure, the government should try actually delivering. Regional Australia and Australian manufacturing need this Prime Minister like they need a hole in the head.

The gas-led recovery is nothing but a slogan. Like Goldilocks, we need just the right amount of gas: enough to deliver certainty of supply and low prices to manufacturers who use gas in their manufacturing processes at the right price and enough to secure grid stability to facilitate more cheap renewables as batteries and other storage technologies fall in price. But gas is very expensive. We don't want so much in our electricity that it lifts prices for households and businesses.

A recent example of the government's policy failure is that in the 2021 budget they announced that they were investing $220 million in—you guessed it—a competitive grants process to build an additional 780 megalitres of onshore diesel storage, but by October BP had announced they were closing their refinery in Kwinana at a cost of 750 jobs. Minister Taylor then announced that they were speeding up support for domestic refineries and that they would create 1,000 jobs, yet last month Exxon Mobil announced that they were closing their refinery in Altona, Victoria, at a cost of 350 jobs.

Since the Morrison government announced that they were securing Australia's long-term fuel supply, half of our domestic oil refinery capability has closed. Industry doesn't need the kind of help that the Morrison government offers. Nationals like Minister Pitt and Senator Canavan might like to parade around in hi-vis and make-up, but they are killing jobs with their disastrous energy policy approach and their fuel security failures. They are like myxomatosis for jobs, these characters. Eight years of blue-collar jobs have gone backwards. In the end, what they are really prosecuting is a weird culture war. They are importing American political rhetoric and exporting blue-collar jobs. That's all the Nationals and Liberals in this place know how to do. They can write a leaflet and they can post a meme, but they can't deliver on energy policy, they can't deliver on energy security, they can't deliver on lower prices and they can't deliver for Australian industry.

Rex Patrick (SA, Independent) Share this | Link to this | Hansard source

I rise in support of the Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill 2020. For decades the predominantly international oil and gas companies operating in Australian waters have engaged in economic pillaging and plundering on a national scale, and nothing has been done to stop it. The intent of the Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill is to make benefit to the Australian community a guiding principle in the Offshore Petroleum and Greenhouse Gas Storage Act. We've heard, on a couple of occasions, that the objectives centre around an effective regulatory framework for petroleum exploration and recovery and the injection and storage of greenhouse gas substances in offshore areas.

I want to make sure everyone in the chamber and everyone listening understands what Senator Hanson's bill seeks to do. It seeks to add these words: 'and to ensure that the exploitation of these natural resources is for the benefit of the Australian community'. I am just flabbergasted that the members on both sides, Labor and Liberal, are going to vote against these words. The Liberal Party is going to vote against this: 'and to ensure that the exploitation of these natural resources is for the benefit of the Australian community'. The government is going to vote against that. Labor is going to vote against that too. I might have to go and look into the statutes for the words 'treason' and 'treachery'. I guess they will be relying on parliamentary privilege to prevent them from being found guilty of such a thing, because that's exactly what's happening here! It's a very mild amendment that seeks to direct officials' and ministers' attention to the fact that we should not be conducting these operations without considering whether or not the activities are for the benefit of the Australian community.

The balance is all wrong, with the scales firmly tipped in favour of exploration and extraction companies. Unsurprisingly they're all saying, 'Don't change anything,' because it's great for them. They try to spin and say that they're doing the right thing, but they're not. I saw Chevron's submission to this inquiry. They talked about employing workers; they talked about paying income tax. Well, I'm sorry; workers pay income tax. They're trying to chalk that up as their credit—that somehow we benefit because the workers pay income tax. Let me just explain to you what the corporate tax situation is for some of those companies. Thankfully, because we have ATO tax-transparency data, we can now see what's going on. ExxonMobil Australia: $56 billion in revenue, rounded, and no corporate tax paid. Chevron Australia Holdings: $28 billion in revenue over five tax years, and not a cent in corporate tax paid. ConocoPhillips Australia Gas Holdings: $7 billion, with not a brass razoo of tax paid. They take our resources and they pay no tax. They pay us nothing for it. Santos: $23 billion in revenue, with only $3 million in tax paid. Beach Energy: $6 billion in revenue, with only $360 million paid.

In the chamber this morning, we heard, correctly, that Australia has become the largest supplier of liquefied natural gas. Yet, in the financial year 2018-19, that delivered a paltry $1 billion through PRRT. By comparison, Qatar generated $26 billion—on less gas! How does that work? I've been around long enough to have watched what happened in 2015. The Labor government was to blame for this. They set up gas trains in Gladstone, which saw the production of gas go up significantly, to the point where, in 2017, there were constituent companies in South Australia coming to the office of my former boss, Senator Xenophon, saying, 'It's not that we can't get a reasonable price; we can't even get an offer to supply gas.' All of the gas was being ripped out of the local domestic supply so that companies could export it overseas. As a result of negotiations, which I was heavily involved in, for the Australian Domestic Gas Security Mechanism, we have seen the supply aspects of this addressed. As has also been pointed out in this chamber, we now have a situation where we're the largest exporter of LNG, but we pay more here in Australia for our gas than what people pay in Asia for our gas molecules. How does that work? It's unbelievable.

But wait, there's more! In 2016, the Australian company Woodside Petroleum dumped a floating production storage and offloading asset, the Northern Endeavour, on a small, undercapitalised company. We're now seeing these stranded assets being palmed off to little players. And what happened? NOPSEMA intervened after the new company took over the platform and drove the owners of the Northern Endeavour into liquidation. The end result is that the FPSO is now laid up in the Timor Sea, being crewed and maintained in lighthouse mode at taxpayers' expense, awaiting decommissioning. The cost thus far to the Australian taxpayer has been $100 million. Go and look at it in the budget papers; you'll see a line item associated with the Northern Endeavour. Woodside finished up with this platform, offloaded it, and then NOPSEMA put the company out of business. I'm not speaking from hindsight. In 2019, I talked to NOPSEMA at estimates. I said, 'You run the risk of having this company go under and the Australian taxpayer owning and having to pay for an oil platform.' They said, 'No, no, Senator, that's not going to happen.' That's exactly what did happen. These companies come into Australia, take our oil and gas and don't give us any return in terms of corporate tax, and then offload their ageing platforms, and we're paying for that now. The total estimate of cost to the Australian taxpayer to fix the Northern Endeavour, to uncouple it from its oilfield and to decommission the site and the vessel is somewhere between $350 million and $1 billion. This is for Woodside's aged vessel. The ironic and sad thing here is that the government went to Woodside and paid them by way of a contract to advise them on how to decommission it. So Woodside take this platform and offload it, and now they're charging us back to give advice on how to get rid of it. It's just unbelievable. You couldn't read about it. Woodside's conduct in this is grossly immoral, bordering on criminal, and what the government has done is mind-numbingly stupid!

We have a bill here before the Senate that seeks to place as an objective in the act some very, very sensible words, that when NOPTA and NOPSEMA are carrying out their work and when ministers are looking at things happening in the oil and gas industry they must ensure that the exploration of these natural resources is for the benefit of the Australian community. But, no: the government can't bring itself to vote for that and neither can the Labor opposition. I listened to Senator Ayres; he's normally quite articulate—he's normally very clear in what he says to this chamber—but he was all over the place. He talked about a lack of jobs and he talked about the fact that we're not getting any return from these gas companies. He talked about a whole range of things, such as the fact that we're paying higher prices and the fact of these import terminals. How crazy is that? We're the largest exporter of gas in the world and yet, at the same time, we're building import terminals. Seriously? That's how broken this is. Yet the government wants to maintain the status quo, supported by the opposition.

It's disgraceful. The very simple words in Senator Hanson's bill require people to consider the benefit to the Australian community, and traitors on both sides of the chamber are simply saying, 'No, we don't want that.' Senator Ayres recognises the problems but doesn't accept what Senator Hanson said, that this is a small nudge in the right direction. Why wouldn't you take it? It's unbelievable. I commend this bill to the Senate.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

The Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill 2020 seeks to insert a new objects clause within that act, which reads as follows:

… to ensure that the exploitation of these natural resources is for the benefit of the Australian community.

One Nation have claimed that this will have ramifications for the operation of the act, including the cancellation of underutilised oil and gas leases and the implementation of gas reservation requirements. The department thinks otherwise, warning that, in its view, the proposed amendment is worded broadly and that it's unclear what benefit is being measured or how it could be quantified.

As far as the Australian Greens go, we want to place a couple of things on the record. Firstly, the gas industry in this country are one of the worst corporate actors in Australia's history. They have made obscene profits by cooking our planet, trashing our environment and trashing cultural heritage. And while they've been doing all those despicable and disgraceful things they have avoided paying almost any tax and have employed barely anyone, while funnelling billions of dollars offshore in profits. They have corrupted our politics with political donations and with one of the most smoothly operating revolving doors in this country, where former ministers and former major-party politicians in this place roll out once they've retired into cushy consultancy work with the gas sector.

Of course, the gas sector is not alone in that—the banking sector does it, the gaming sector does it and the coal sector does it—but the gas sector is right up with those other rent-seekers, those other parasites and those other destroyers of our democracy in regard to a very, very smoothly operating revolving door, which has very, very deleterious impacts on our body politic.

Let me make it clear what gas is in this country. It is the fastest-growing source of pollution in Australia, which is driving the breakdown of our climate. Even as we give these speeches today in debating this bill our climate is breaking down around us. Gas is as dirty as coal. Of course, like coal, the overwhelming majority of the gas that we extract or mine in this country is exported. Interestingly, in Australia the biggest domestic user of the gas that's not exported is the gas industry itself. It's not the manufacturing industry or domestic consumers. The biggest domestic user of gas in Australia is the gas industry itself. That's because it requires massive amounts of dirty energy to extract the gas and to process it into liquid to get it ready for export.

We heard some very interesting facts and figures from Senator Patrick. I'm going to add some further facts and figures for this chamber now in regard to the abject failure of the gas industry to pay its fair share of tax and the extent to which the gas industry is polluting our environment and driving the breakdown of our climate. In the 2018-19 financial year, 28 major gas companies sold $55,112,837,464 of gas and paid no tax whatsoever. No tax whatsoever was paid by those 28 major gas companies which sold over $55 billion worth of gas. They paid no tax.

It's about time we cracked down on tax avoidance in this country. It's about time we forced big corporations to pay their fair share of tax so that we can fund the supports for our people that the Australian population expects—the public services that they expect, like a functioning hospital system, a strong public education system, extra support for people with disabilities, extra support for people in aged care and extra investment in public transport to help us reduce our greenhouse gas emissions. Those things we can fund if we make the big corporates pay their fair share of tax.

Big corporate tax avoidance is not limited to the gas sector in this country, but, boy oh boy, they are right up there in terms of their absolute tax avoidance. I will just mention a few companies on the way through. For example, Chevron Australia Holdings Pty Ltd emitted 13.1 million tonnes of CO2 equivalent gases in 2018-19. In that financial year Chevron Australia Holdings Pty Ltd gave over $124,000 in political donations in this country and paid zero company tax. In the 2018-19 financial year, Woodside Petroleum Ltd emitted 9.2 million tonnes of CO2 equivalent, gave over $280,000 in political donations and paid no company tax whatsoever. In the 2018-19 financial year, Santos Ltd emitted 5.8 million tonnes of CO2 equivalent, gave $150,000-plus in political donations and paid zero company tax. These corporations are leeches on our body politic. They are leeches and parasites on our country and they are getting away scot-free by avoiding their tax obligations in Australia and paying no tax whatsoever. Why are they doing that? Because they've got the two major parties quite comfortably in their pocket.

It is no surprise to the Australian Greens that we are seeing a unity ticket on this legislation between the Liberal and National parties and the ALP, because they both support the so-called gas led recovery. They both support opening up massive new gas fields for fracking in places like the Galilee Basin and the Beetaloo Basin. Of course, they both love a bit of coal-hugging and support, on a unity ticket, for the Carmichael coalmine proposed by Adani. Not only do these 28 major gas companies dodge their tax obligations but they employ less than 0.2 per cent of the Australian workforce. Over the journey they've given tens of millions of dollars in donations, and now in return you've got Mr Morrison and Mr Albanese wanting to give the gas industry our public money to expand. Well, enough is enough. Stop selling yourselves out, stop selling Australians out, stop selling our climate out and stop coming in here and shilling for a gas industry buying your votes with their dirty political donations.

An expansion of our gas industry using public funds, as supported by both major parties in this place, will not only squeeze out cheaper and cleaner renewables but actually lock this country into decades of higher pollution, particularly greenhouse gas pollution, and higher energy prices. The International Energy Agency has said that we cannot have one single new piece of fossil fuel infrastructure if we want to meet the Paris Agreement. But, of course, while both major parties in this place love to pay lip-service to the Paris Agreement, when you look at what they're actually doing, they are both actively seeking to undermine it. Gas has no place in a clean, modern economy. We need to be building a clean, modern economy so we can drive thousands of jobs in construction, tens of thousands more in smart manufacturing, and tens of thousands more in reforesting, rewilding and urban greening so that we can actually help nature to draw carbon down from our atmosphere.

The Greens are proposing a second reading amendment, which has been circulated in the chamber. It's based on our view that, while we should be utilising our natural resources to the benefit of the Australian community, we have to be careful about defining what that benefit actually is. Fossil gas is cooking our planet and it's doing so, in the main, through the methane released during extraction and transport, through the liquefaction of gas into LNG for export, and through the combustion of gas in buildings, energy and the electricity sector. Benefit to the Australian community, particularly if you—as the Greens do—place value on the wellbeing of future generations of Australians, must take into account these climate impacts. If we're going to have any hope of meeting the temperature goals of the Paris Agreement to prevent us from driving over the climate cliff into significant collapse of our civilisation, we must have a plan to keep gas in the ground. That is the why we are proposing a second reading amendment in the terms that the Senate is of the opinion that Australia's offshore oil and gas industry is a large contributor to climate change and that it is to the benefit of the Australian community to hold the increase in the global average temperature to well below two degrees above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5 degrees Celsius above pre-industrial levels.

As I said, what a surprise that we are now facing the Liberal-National parties and the ALP on a unity ticket on gas, doing the bidding of their dirty corporate donors in this place, preparing their post-parliamentary careers through one of the most smoothly operating revolving doors in this place! Don't even get me started on how we negotiated the treaty over the Timor Sea gas with Timor-Leste, when we bugged the Timor-Leste cabinet when they were deliberating over the treaty. As a result, some of the big gas corporations absolutely made off like bandits and made obscene profits while Australia's government actively worked to ensure that Timor-Leste, one of the poorest countries in the world, was dudded through those negotiations. The ramifications of that are still happening today as Bernard Collaery faces court over a politically motivated set of charges and Witness K has pled guilty. We are awaiting developments in those legal matters.

I say to colleagues: if you want to have a look at the power of big corporate gas, read Mr Collaery's book and weep at the way that the gas industry in this country, like the coal industry, the banking industry and the gaming industry, owns politicians in this parliament, how they capture those politicians with their dirty corporate donations and how they buy votes with institutionalised bribery and the promise of cushy, well-paid jobs once people have finished their efforts shilling for the gas industry in this place. I move the Greens second reading amendment:

At the end of the motion, add: ", but the Senate is of the opinion that:

(a) Australia's offshore oil and gas industry is a large contributor to climate change; and

(b) it is to the benefit of the Australian community to hold the increase in the global average temperature to well below 2°C above pre-industrial levels and pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels."

Jacqui Lambie (Tasmania, Jacqui Lambie Network) Share this | Link to this | Hansard source

The Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill 2020 is a simple bill that does a lot. I have to say, 'Well done,' to One Nation. I sort of wish I'd thought of it myself. All the bill does is say that the benefits that come from Australia's natural resources should go to Australians, not overseas and not to big multinational companies. Those resources belong to us, every Australian, and they should benefit us. That money should be going back into our public hospitals. We shouldn't have people waiting on level 1 for months and months to get operations. We have educational problems out there. We should be throwing money and everything we've got at that and aged care, NDIS, mental health services and the list goes on and on.

I don't understand how in God knows how many years Australia has come to this much of a mess when it comes to our resources that are sitting in our ground and how we've missed out on so much of the share of that. The major parties in here have undersold us, and both of them should be absolutely ashamed of themselves today. That's what we are talking about. That is all this bill does. It says our resources should benefit Australians. It says the benefits should come back to us. From here on out in the future, if you are going to make deals and sell our resources then make sure 51 per cent stays in Australian hands. Can't we at least do that from here on in?

This bill does that by saying that the regulators that approve offshore mining projects have to make sure those projects benefit Australians before they can go ahead. It is simple, it's effective and it's common sense. Who could be against making regulators make decisions about what's in the national interest? I'll tell you who. The Liberal and Labor parties—that's who. They have been underselling us for years and have ripped us off and ripped off the Australian people. It completely blows my mind. It blows my mind that the major parties think that expecting our regulators to do the right thing by the country is controversial. What could possibly be controversial about expecting our regulators to put Australians first? How can that be something you would worry about?

This is the sad reality of where we are today. The Liberal and Labor parties think it is fine to sell out Australians. That's what they've been doing for years. I'm surprised we own anything these days. They talk big on doing what's right by the country, but, when it comes down to it, they will sell us out every time and as cheap as chips. That's where things are at. This sort of attitude is why Australian industry is in the state it's in. And don't even go into manufacturing; it goes well beyond offshore mining.

You're selling the country out from under our feet and you've been doing it for a very long time. The Tasmanian farmers know that's true. I say this to the major parties: go and talk to them for five minute and in five minutes you'll see how much of a problem we have here. We're selling all our farmland to China. We're letting foreign investors buy up our country. What has happened to our food security? You have sold us out on everything else. What about food security for our future, our children and our grandchildren? We're letting all our iconic Aussie brands go overseas. We're letting all our profits and benefits—the fruit of Australian workers' labour—get carved off overseas. We're letting overseas investors come in and just buy up the Australian companies that keep regional communities working—the companies that hold up and support entire regional towns. They just buy them up, and it's all going on under the mantra of free trade. Free trade? Well, someone's getting something for free and it ain't the people of Australia! They're not getting anything for free. The cult of free trade has made Liberal and Labor blind to what's going on under their own noses. You don't want to see the truth. You don't want to see what your decisions in the past have done to this country. Quite frankly, you should be ashamed of yourselves.

I just don't get it. I don't know the reason why. I don't know if it's their political donors—that is more than likely so, and, by the way, they can be bought as cheap as chips, and that's even more embarrassing—or if it's just plain arrogance, but they don't want to admit that we have a problem here. This is why I've been saying that we need to get our country making things again. Make Australia make again! Don't just sit out there and talk the talk; I want to see you walking the walk—and so do the people of Australia. We want to see manufacturing. We want to be self-sufficient. That's what we want. Stop selling us out, because, I'll tell you what, there's not a lot left. If there's anything that the past year has shown us it's that we have to start backing ourselves, backing our industry and backing the people here in our own country. Stop undermining us. Stop undermining our resources. Stop undermining the people of this country. If you don't think we're smart enough to carry it out then have the courage to stand up and tell us so.

We need Australian-made free trade. That's the lesson of the coronavirus, yet you've learnt nothing out of this. That was your warning, and there'll be more to come, no doubt. God works in mysterious ways. It's called karma. If you haven't learnt from this and you haven't got manufacturing up and going and you're out there just talking the talk and not walking the walk, then watch it come back to bite you fair on the backside, because it will. We've got to be self-sufficient again. We've got to start owning our own resources and our own industries, because what we make we control. Nobody else controls us. That's what the major parties don't seem to understand. They just don't get it, or maybe they don't want to get it. Maybe it's more to the point that it's so far gone they have no idea how to fix.

This is what I say to them: we have to start backing our manufacturing sector, we have to strengthen the rules around foreign purchases of our key assets, and we have to diversify what we're making and who we're selling it to so no other country can control the fate of our country. There's so much work that needs to be done, but every time the crossbench tries to get started the major parties drag their feet. They put their fingers in their ears and their hands over their eyes. They just don't want to hear it and that's terribly sad.

This bill won't fix everything. As I said, it's a simple little bill. There's a lot that needs to be done, but what we're talking about today deals with one small part of a bigger problem. It's a start. It's pointing us in the right direction. It's clever and it's common sense. Once again, I thank One Nation for bringing it up in the chamber and, once again, I hear very little out of the major parties. Let's face it, we're in the situation we're in today because of the both of you, and that is shameful in itself. And you can't even admit that these days, because, apparently, everything is rosy out there! I don't know where you guys sit. You might want to get out of your bubble and see what's really happening out there on the ground because, I can tell you, where this country is right now would bring tears to your eyes. That's why I support this legislation. Everyone else in this place should do so as well. Shame on those who do not. For once in your life you can make a difference in here today, which you will not do because you can't see through your own faults. You cannot see that.

This country is a mess, if you haven't noticed! It's a mess. You've been selling it out for way too long. You've sold the Australian people out year after year and there's bugger all left out there. Well, I'd like some of that back—like the millions of others out there. We want that money going back into our health system and our aged-care system. Don't worry about cutting the NDIS, like you're already doing over there, Liberals—that's exactly what you're doing. If you'd invested in it in the first place and done the right thing then you wouldn't have to worry about money. All those resources out there were given as cheap as chips to everyone else, and that could have been coming back into the country. That money could have been serving in our schools and making our kids smarter by investing more in them. This is where we are today. Quite frankly, it's shameful.

Andrew Bragg (NSW, Liberal Party) Share this | Link to this | Hansard source

I rise to make some remarks on this private senator's bill, the Offshore Petroleum and Greenhouse Gas Storage Amendment (Benefit to Australia) Bill 2020. I accept that there are laudable objectives being pursued here by the crossbench.

I'll start by making it known that I have a particular philosophy of government, which I would describe as a form of Menzian liberalism. When it comes to these matters, Menzies himself said in a 1961 election speech:

For governments have no money to spend except that which has been earned and paid over, by tax or loan, by the men and women of Australia.

That is my philosophy for government.

When it comes to the conduct of large companies, there's a basic judgement that governments need to make as to how these are regulated and taxed in the public interest. In this country we have regimes to deal with that, but it has to be based on the idea, in my view, that the government itself can't be the generator of revenue or the driver of the economy; that needs to be done by the private economy. In our world, where we live with a small domestic population but with the 12th-biggest economy on earth, we must rely upon foreign investment and private investment—both—in order to fund our lifestyles into the future.

As I said, I think there are some laudable objectives in this bill, and when it comes to the question of regulation and tax there's no doubt that the debate about large companies in terms of banking institutions, technology companies and oil and gas companies is an important topic for this chamber. It's one where good people will have different views. My view has been that big tech should have more regulation and my view, especially following the Hayne royal commission, is that there should be more regulation in the banking space. And my view on oil and gas is that there's a case which can be made that there should be more taxation paid. But taxation, by the way, is not levied on revenue; taxation is actually levied on profit. I think that's a sound principle, but I think we could look at this again. We have a regime, the PRRT, which deals with these matters and it is something that needs to be working in the interests of our country.

There's an industry which has been driven by my former colleagues in the accounting profession designed to harness base erosion and profit shifting for large companies, and that has been a major issue. It's not an issue that Australia, by the way, can solve on its own. Base erosion and profit shifting is like climate change: you can only solve it through a multilateral framework through international agreements. I think that most attempts to deal with it unilaterally are pretty futile. Of course we can consider going back to 1973 or 1974 and talk about Rex Connor and his plans to nationalise resources, but they weren't good plans. That was not a successful period: inflation was at 15 per cent and it took 20 years to get the budget back into the black. I don't think we should do that, but I do think the issue around the way that large resources projects have their tax arrangements set is an issue we should pursue. I think there is a case to be made that more tax could be paid, but tax has got to be paid on profit.

In my mind, the two key outputs of the gas and oil industry are the large amount of largely foreign investment that it brings—we haven't got enough money in this country to develop our own country; we never have and never will, especially not with the way the superannuation system has been allowed to run so poorly—and jobs. There are 30,000 direct jobs and 80,000 indirect jobs. Those are important things. If the crossbench is seeking more taxation to be paid on profit, that is something that could be pursued, but not through this exact bill. I seek leave to continue my remarks.

Leave granted; debate adjourned.